Patents and Innovation Economics

Federal regulations take up 81,000 pages and annual compliance costs are now $1.75 Trillion or 12% of U.S. GDP. This is enough money to hire a quarter of the U.S. workforce. (For more information see Episode Two: Economic Freedom in America Today). Note that this does not include the cost of tax compliance, which is estimated at $431 Billion per year. There is now a very modest proposal to put a halt to excessive and unnecessary and unconstitutional regulations called the REINS ACT, introduced by Congressman Geoff Davis. This piece of legislation requires an up-or-down vote on all new proposed rules with an economic impact of over $100 million by both the House and the Senate and the signature of the President before they can be enforced on the American public.

I have written on this issue before, see Regulatory Bill of Rights. Regulatory rules are used to circumvent not only Congress’ rights under the Constitution, but used to circumvent your rights under the Bill of Rights. The penalties for regulatory infractions can include severe financial penalties and jail time. Our Founding Fathers did not intend that the Bill of Rights to only apply to so called criminal laws. Our government circumvents the Bill of Rights by pretending they are enforcing a civil law instead of a criminal law. The only true civil law in the U.S. is between private citizens not a law between the government and the people – those are criminal laws.

The REINS Act is a very modest piece of legislation and does not go nearly far enough in curtailing the power or regulatory agencies, but it’s a start.